Most believe that in order to build credit you have to start when you’re a student so that by the time you retire you’ll have excellent credit; but by then you probably won’t need it. The time when you need credit the most is usually the time when you don’t qualify for it and you can’t seem to find it anywhere. So if you fall into the latter category of not being able to build credit fast enough, then here are some helpful suggestions on how to build credit quickly.
• Order a credit report. The fist step in quickly building credit is to find out what your credit scores are. Getting credit scores used to be a lengthy drawn out process that wasted your time and cost you money. Today however things have changed and are much more accommodating. You might not know it, but everyone is entitled to receive a free credit report once every 12 months from each of the three major credit bureaus. Your credit reports are necessary for you to have so you can measure and understand exactly how bad (or good) your credit is and what needs to be done to fix it. The credit score is what you are looking for when you get your report, so you might have to pay to get those. Make sure that when you go through your credit report that everything is correct. You’d be surprised at how many errors some credit reports have that can cause poor credit scores.
• Open a checking and savings account. Although you might be thinking that these accounts don’t do anything for your credit they do. By having a checking and savings account you are showing lenders and credit agencies that you are making money, keeping it, and are responsible for it. That will always help to build credit and trust.
• Secured credit cards. If you are unable to qualify for a regular credit card then go into your bank and get a secured credit card. If you have already opened a checking or savings account then in most cases your bank will have no problem offering you a secured credit card. There is almost no risk for the bank with these types of credit cards but they can still help your credit standing. The card is secured by money you place on it. The balance you put on the secured card is the card limit; once it is gone there’s absolutely no way to spend more until you load the card again. The best thing about secured credit cards is that credit bureaus have no way of differentiating between a regular credit card and a secured one (unless it is disclosed to them). So make sure when you sign up for one of these that your payments get reported to the credit bureau; otherwise it does nothing to help your credit.
• Department store credit cards. This is another way to start building credit quickly. While you cannot use store credit cards anywhere you want you can use them in the store you signed up for it in. If you do a lot of shopping at Sears, then signing up for a sears card can work toward your advantage (if you don’t overspend). Some other ideas of store credit cards are Wal mart, Target, certain gas stations, Costco, etc. Grocery stores are great places to sign up for credit cards because food is always in the budget. You can buy the groceries on credit and pay it off immediately. Big stores like Costco that offer groceries and a place to fill up the car with gas can also work toward your advantage. It’s easy to put it on you store card and then quickly turn around and pay it off before the debt gets too unmanageable. You can really start building credit quickly this way.
These are a few ways you can start to build credit quickly. Once you have some sort of credit history you will then be able to apply for a regular credit card and really start establishing great credit.